Why the Concerns over Facebook’s Video Metrics are Overstated

Why the Concerns over Facebook’s Video Metrics are Overstated

There has been a lot of press recently around the accuracy of Facebook's video metrics. There are questions around measurement criteria such as 'What counts as a video view?' and 'Which views count toward the completion rate?' Some press and media outlets have questioned the value of these viewers and, more importantly, the validity of the data around these users. I believe these claims against new video platforms like Facebook and YouTube are dramatically overstated. “Concerns” about the accuracy and validity of viewers on digital platforms seem more like fear, uncertainty, and doubt that Cable TV providers are casting against the newcomers because their industry is threatened rather than true concerns around the metrics.

For decades, Cable TV has used a very small set of Nielsen families to track the viewing habits of all Americans. In fact, Nielsen extrapolates data for over 300 million people by using just 0.02% of households. This archaic tracking methodology is significantly less precise than Facebook and YouTube, which essentially use all available information -- 100% of their users -- to make extremely accurate viewing determinations. You will probably continue to hear additional noise in the coming months as a tidal wave of dollars -- billions tall -- comes rushing in from Cable TV toward connected video platforms. That won't make these claims any more true. When all is settled in the next few years, the most massive appropriation of advertising dollars in history will have occurred.

According to Nielsen, there are roughly 116 million TV-viewing households in the United States. If there are roughly 2.5 people per household, that’s nearly 300 million TV-viewing individuals in the United States. Out of the 116 million households, Nielsen only records data from 25,000 homes -- that’s only 0.02%. Far less than one-tenth of one percent of TV-viewing households are being tracked by Nielsen. For advertisers, this method of collecting data makes Cable TV advertising a huge guessing game. And even within this micro-sliver of the population, there’s no way for Nielsen to measure accurately how many people are losing attention after three seconds of an ad. There’s also no way to accurately understand the viewing population when there is such huge potential for missing key demographics by using miniscule sample sizes. All of these concerns are resolved with the new video platforms.

Facebook and YouTube record data from 100% of people who view a video. It’s true that the view count you see underneath a Facebook video only includes people who viewed the video for more than three seconds. However, Facebook also determines, for every single user, how much of the video they watched, their exact moment of drop off, and very deep demographic information about the viewer. They transparently make this data available to publishers, advertisers, and anyone else who has been granted Insights access. Online video platforms can actually guarantee advertisers that their content will be viewed by a specific number of people.

At last count, $79 billion is spent on TV ads per year compared to just $10.1 billion spent on social advertising per year. 800% more advertising dollars are spent on Cable TV than social. Advertisers chase the eyeballs -- they always have. Viewing time for social media is within striking distance of the same metric for Cable TV. In order to balance the eyeballs and dollars, $23B would have to move from Cable TV to social media immediately, and that number will grow substantially going forward. Given the shortcomings of Cable TV ratings, especially when compared to the extremely detailed metrics that platforms like Facebook and YouTube can provide, the stage is set for this massive migration of these dollars. Of course Cable TV is feeling threatened. They are primed to lose billions of dollars in advertising revenue every year, so they vocally and publicly question the validity and accuracy of new media metrics.